Saint Mary of Nazareth Hospital Center v. Schweiker
Docket: Nos. 82-1034, 82-1047 and 82-1052
Court: Court of Appeals for the D.C. Circuit; August 28, 1984; Federal Appellate Court
The opinion addresses the jurisdiction of the Provider Reimbursement Review Board (PRRB) over claims made by St. Vincent Hospital and Medical Center of Toledo. The court previously issued an opinion on September 23, 1983, but withheld judgment on PRRB jurisdiction pending a rehearing in a related case. The panel in Athens Community Hospital, Inc. v. Schweiker has now issued a modified opinion deemed controlling, leading to the affirmation that the PRRB lacks jurisdiction over St. Vincent’s claims.
St. Vincent was unique among the seventy-two hospitals involved in a group appeal, as it included labor/delivery patients in its inpatient counts for cost reporting, which was submitted on time to its fiscal intermediary, Blue Cross of Northwestern Ohio (BCNO). After receiving a Notice of Program Reimbursement (NPR) from BCNO, St. Vincent requested a reopening of its cost report to exclude labor/delivery patients from its inpatient count, a request that BCNO denied. St. Vincent then sought to join the group appeal concerning this issue. The PRRB initially accepted jurisdiction, arguing that the reopening allowed for any claims for additional reimbursement, but the Deputy Administrator reversed this decision.
The court found that St. Vincent did not indicate prior to the NPR issuance that it intended to exclude labor/delivery patients, which is necessary for the PRRB to have jurisdiction. According to Athens II, the PRRB can only review matters for which reimbursement has been explicitly requested. Since St. Vincent did not raise the labor/delivery issue in its initial cost report, the PRRB could not review it on its own initiative, and the intermediary did not need to consider it during its original review. St. Vincent’s argument that the reopening of an unrelated issue should enable the introduction of the labor room claim was rejected. The court emphasized that reopening decisions are specific to issues and lie solely with the intermediary, and that allowing a provider to introduce new claims through an appeal would undermine this principle. Reopening is permitted only for new evidence, not new claims.
St. Vincent attempted to present a new claim not previously included in its cost report, which Athens II clarifies that BCNO had the right to refuse to reopen for such claims. BCNO's decision not to reopen is deemed final under 42 C.F.R. 405.1885(c) (1983). St. Vincent contends that existing rules permit intermediaries to reopen reports in a piecemeal manner, arguing this could lead to irrational or unfair outcomes. However, it is established that for an intermediary to disallow a cost, it must be present on the cost report. If a cost is disputed, the PRRB has jurisdiction to address its resolution, potentially requiring adjustments to other parts of the report, as allowed by 42 U.S.C. 1395oo(d) (1982) and 42 C.F.R. 405.1869 (1983). Nevertheless, this situation does not apply to St. Vincent's case, as the issues at hand do not connect to the matters BCNO reopened. Consequently, the Deputy Administrator's determination that the PRRB lacked jurisdiction to hear St. Vincent’s claim is affirmed. The panel in Athens II reiterated that the PRRB properly declined to exercise jurisdiction over new claims not presented to the intermediary. The central issue is whether the PRRB has jurisdiction over claims not initially submitted to the intermediary and not permitted for reopening.
